A New Regulatory Threat to Directed Donations

On January 23, 2006, “the OPTN/UNOS Board of Directors requested that HRSA take this action to give OPTN live donor policies the same status as other OPTN policies.” The Federal Register asks that interested parties submit their comments to Dr. James Burdick, Director,Division of Transplanation on or before February 22, 2006. I believe that this action poses a serious threat to one of the few positive developments in the organ transplant area. The substance of my response to Dr. James Burdick, HRSA jburdick@hrsa.gov reads as follows:

Indeed I regard the issue as so important that I use the opportunity to post the substance of my comments on the University of Chicago Law School Faculty Website, and make it available to anyone else who wishes to publish it openly. I should state at the outset that I have written this post on my own account, and not as a representative of the Law School or any other association or corporation that might have an interest in this position. I write as one who has worked in the area of organ transplantation for well over a decade, and who believes that the current organ shortages should be laid squarely at feet of OPTN/UNOS whose own restrictive policies have been directly responsible for the needless deaths of thousands of individuals over the entire period in which they have been in effect. There is indeed a need to obtain some degree of parity, which is best done by limiting the power of OPTN/UNOS to meddle in organ transplantation policy beyond the minimum needed to comply with the requirements of the National Organ Transplantation Act of 1984 (whose repeal or radical redrafting you should work feverishly to achieve).
The great vice of the current transplantation policy is that it acts on the indefensible assumption that individual forms of altruism are sufficient unto the day to over come the gaps between organs demanded and those supplied in either the live or cadaveric markets. It is often said that sound organ transplantation policy requires “special” treatment in late of the delicate moral and social issues that altruism introduces into the situation. But the current shortages which result in numerous unnecessary deaths are easily predicted by the simplest of neoclassical economic models that project that more organs will be demanded at a zero price than will be supplied. That naïve neoclassical theory goes on to predict that rational individuals will seek to find ways to put themselves higher on the queue than the impersonal system of allocation is used once the NOTA price control system is in effect. The descriptive situation is fully accounted for without any appeal to any more complex economic or sociological model. The element of shortages is endemic in the current system, and no amount of exhortation, or smiling faces of grateful people on UNOS’s web site, can conceal that the waiting list as of the time this letter is being written stands at 90,616.
In the context of this tragic situation, the only long term solution is a complete repudiation of the national organ transplant policy that has led to this deplorable situation. The moral logic in favor of a compensation system is that, given the small but real risk of danger to organ donors, some compensation to them will increase the total output. The precise numbers here are unimportant, even if the orders of magnitude matter. But if the odds of death or adverse events from live donor transfer are 1/1,000, then some beneficial exchange to both sides can take place when the gains from transfer result in an expected increase of life measured in years, not days. Add altruism into the mix, and little changes except the equilibrium price at which live donors come forward: these prices will still be above zero (which is why we have the shortages), but would nonetheless be below those which would be observed in a market that was populated only with egoists. The presence of altruism makes voluntary exchange work better, not worse.
All this is foreclosed by the current NOTA structure, which is run by boards whose main objective is to continue to dominate from its questionable “moral” basis organ donations in the United States. As mentioned earlier, their current maneuver is intended to force everyone into the UNOS queue system, by precluding any “directed donations” to strangers. The stimulus for this is the ready observation that individuals appeals for organs, often done on line and without any offers of compensation, have elicited some positive responses that have worked to increase overall the size of the donor pool, which has to be regarded as an unambiguous good. There is no reason to believe that donors who are striped of their right to select their donee will contribute to an anonymous pool of donees.
In addition, and the point here is complex, it may well be that the considered individuated judgments may have also made small but incremental improvement in the selection of people who receive the organs in question, a subject that UNOS has always tiptoed around by its use of formalized tests. Yet while government committees cannot pick out worthy donors, individual donors do not labor under the duty of public justification and are able to pick people to whom they are drawn. Since, moreover, there is a diversity of views on this question, we have some reason to believe that the lives that they save will be well chosen, but not by any single metric. One donor could prefer to donate a kidney to a mother with young children. A second donor may wish to donate a kidney to a brilliant scientist whose whole live is in the lab. Each can act alone. Neither has to persuade the other. No third party should have the effrontery to challenge either.
I think that it is little short of evil to insist that these directed donations that allow for voluntary matching with strangers be snuffed out by a public bureaucracy that has a proved track-record of failure, and which is so willing to sacrifice many lives on its is preconceived, but ill-formed “equitable” standards as to the appropriate system of queuing that has no place in a free society. You should do whatever is within your power to resist this effort to cut out responsible private efforts to undercut the domination of a government monopoly, which in the end is far more motivated by its own love of turf than in any effort to increase the number of persons who are saved by voluntary donations. (Quick: name one action in which OPTN/UNOS has sought to reduce its power.) Do not let this dangerous initiative see the light of day, and work hard to undo the major structural decisions of NOTA that have led to this morally indefensible situation.

Comments

[Doug Lichtman]

Richard -

One response heard to arguments of this sort is a concern that a market-based solution (no matter how subtle) will discourage altruistic giving. The story, as I remember it, is that it becomes less attractive to give for altruistic reasons if the altruistic signal is ambiguous; you might, after all, be giving for the money. Do you know if there is any empirical evidence on this sort of question? That is, what happens to a set of interactions when we add "market forces" on top of what used to be a purely altruistic transaction?

ps. I should add that I am sympathetic to your cause here; I just would like to better understand the types of arguments that might be raised on the other side, and how well founded they are in real-world evidence.

[slevmore]

There is something of a collective action problem. I may direct my donation, figuring that if I need one I will take my place on a list (or be the beneficiary of a direction donation, if legal). But if we gave priority to well-intentioned donors, we might get many more donors, and then we might all be better off. This is the idea of Lifesharers and perhaps other donor "clubs;" the individual promises to donate but gives first priority to other members of the club. A separate question is whether we ought to do this regionally or nationally and perhaps even as a default rule. I am not sure whether the posted distaste for the current regulated scheme evinces an argument for private, directed donations - or for the club or priority approach.

[Scott Scheule]

Doug,

I recall a blogger at Crooked Timber writing about the topic, with evidence that in some situations altruistic giving can be discouraged by commodification. You might be able to find the post.

[Lloyd Cohen]

Richard,

I couldn't have said it better myself.

In response to Doug's question about the existence of remuneration reducing the amount of altruistic giving there are at least three formulations of this objection. The first and least problemmatic is the shifting of otherwise altruistic giving into the remuerated market. That result is merely a modest and arguably warranted wealth transfer.

The second is a discouragement of altruism by some individuals who do not accept compensation and instead drop out of the market. This can partially be dealt with by making explicit provision for donation of the compensation to charity in the program of organ acquisition.

The third is a notion that the decline caused by the second sort of problem could be so large as to swamp any increase in the provision by those encouraged by compensation. I know of no empirical evidence on the question--it is hard to imagine what it would be--but I offer the observation that it borders on the fantastic. Note as well that since the payment to the donor is a pure wealth transfer that it can be raised to virtually any level without a real economic cost. This may be a failure of my imagination but I can not conceive of a world in which the number of new people induced to provide a kidney at $1,000,000 a pop would not be greater than the current altruisitic donors who would drop out of the market if payment is offered.

Lloyd Cohen